Liver IGF-1–deficient (LID) mice have a 75% reduction in circulating IGF-1 levels and, as a result, a fourfold increase in growth hormone (GH) secretion. To block GH action, LID mice were crossed with GH antagonist (GHa) transgenic mice. Inactivation of GH action in the resulting LID + GHa mice led to decreased blood glucose and insulin levels and improved peripheral insulin sensitivity. Hyperinsulinemic-euglycemic clamp studies showed that LID mice exhibit severe insulin resistance. In contrast, expression of the GH antagonist transgene in LID + GHa mice led to enhanced insulin sensitivity and increased insulin-stimulated glucose uptake in muscle and white adipose tissue. Interestingly, LID + GHa mice exhibit a twofold increase in white adipose tissue mass, as well as increased levels of serum-free fatty acids and triglycerides, but no increase in the triglyceride content of liver and muscle. In conclusion, these results show that despite low levels of circulating IGF-1, insulin sensitivity in LID mice could be improved by inactivating GH action, suggesting that chronic elevation of GH levels plays a major role in insulin resistance. These results suggest that IGF-1 plays a role in maintaining a fine balance between GH and insulin to promote normal carbohydrate and lipid metabolism.